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UTILITIES COMMISSION MEETING <br />TO:FROM: <br />ERMU Commission Melissa Karpinski –Finance Manager <br />MEETING DATE: AGENDA ITEM NUMBER: <br />January 11, 2022 5.1 <br />SUBJECT: <br />Amended 2022 Annual Business Plan (Budget, Schedule of Rates & Fees) <br />ACTION REQUESTED: <br />Adopt the Amended 2022 Annual Business Plan <br />BACKGROUND: <br />At the December 14, 2021, commission meeting, the 2022 Annual Business Plan was adopted <br />bythe commission. Minnesota Municipal Power Agency presented their final budget at the end <br />of December, with rates lower than previously communicated. With this there have been some <br />changes to power costs and rates. The final highlights are discussed below. <br />DISCUSSION: <br />Electric Budget and Rates <br />In December, a 5% rate increase for 2022 was adopted. We are proposing to reduce this to <br />havea 3% rate increase for 2022. <br />Notable items in the electric budget for 2022 are: <br /> 3% wage adjustment for Office, Field, and Management pay plan groups and a 2.8% <br />wage adjustment for Line Worker pay plan group. <br />Conservative estimate for usage and growth. <br />6% wholesale power rate increase. <br /> Interest expense on bond for new field services building. <br />Administrative expenses for InventoryAssistant and new General Managerpositionsto <br />be filled in 2022. <br /> Administrativeexpense for Travel and Training; additional leadership training (all <br />departments as identified in organizational effectiveness survey)and management <br />training (includes strategic planning). <br /> Replacement of Bucket Truck #4. <br /> Replacement of Dump Truck #7. <br />Purchase of a Bobcat, forklift, and sweeper. <br /> Shared cost in the replacement of Vehicle #1 for Administration and Pickup Truck #2 for <br />Technical Services. <br /> Electric Service Territory acquisition loss of revenue for Areas 1&2, 3&4, 5&6, and 7&8 <br />from reserves. <br />______________________________________________________________________________ <br />Page 1 of 2 <br />59 <br />